Nicolas v. Reparations Commission
The case of''' Nicolas v. Reparations Commission and Pastoral''' deals with an appeal on certiorari regarding the stipulation on venue in the terms and conditions of a contract. The facts of the case shows that the parties agreed in a written contract that states: "all legal actions arising out of this subject... may be brought in and submitted to the jurisdiction of the proper courts in the City of Manila." ''Here, there is an issue on whether the parties can sue in courts outside of Manila or not? Background * 1959 - Francisco J. Nicolas filed an application with the Reparations Commission for the acquisition of three (3) units of fishing boats complete with fishing net, gears, and other equipments thru the Japanese Reparations. * Feb. 28, 1961 - The Commission procured one (1) fishing boat with its accessories to Nicolas by executing a Contract of Conditional Purchase and Sale of Reparations Goods, which is subject to terms and conditions; one of which is paragraph 3: ** ''The Conditional Vendee agrees to pay the Conditional Vendor whatever is due the latter at its office in the City of Manila. It is agreed upon that all legal actions arising out of this contract or in connection with the reparations goods made subject hereof '''may' be brought in and submitted to the jurisdiction of the proper courts in the City of Manila.'' * Oct. 25, 1966 - The Commission adopted Resolution No. 245 (66) due to the unauthorized sale of the fishing boat by Nicolas in violation of the End-User Contract and the Reparations Law. The Resolution mainly aims to take immediate steps for the Commission to repossessed the fishing boat. * Mar. 17, 1967 - The Commission denied Nicolas's motion for reconsideration of Resolution No. 245 (66) and adopted Resolution No. 101 (67) which resolve to rearward the fishing boat to Pedro Pastoral (Pastoral Fishing Industries, Inc.) subject to the same conditions. * March 27, 1967 - Nicolas filed Civil Case No. 920 of the Court of First Instance of Rizal, Branch VI, against the Commission and Pastoral for breach of contract. * April 3-4, 1967 - The Commission and Pastoral filed separately a motion to dismiss on the ground that the venue of the present action was improperly laid (Sec. 1, Rule 16, Revised Rules of Court) in that the stipulation in paragraph 3 of the terms and conditions of the Contract that clearly indicates the intention of the parties to exclude all courts other than those of the City of Manila and that the use of the word "may" shall be interpreted as mandatory. They claim that the reason behind such stipulation is to prevent any suit in any venue other than which had been agreed upon by the parties. * April 5, 1967 - Nicolas filed his opposition to the motions of the Commission and Pastoral, contending mainly that the word "may" used in the agreement on the venue is permissive and not mandatory in nature and hence does not prohibit any of the parties from filling a suit in courts other then those of Manila. Moreover, there is no beneficial purpose in restricting the venue since Nicolas resides in Makati, Rizal, while the Commission and Pastoral both resides in Quezon City. * April 14, 1967 - The Court granted the motion to dismiss on the ground that the venue is improperly laid. It assets that the stipulation on venue was "precisely made and primarily intended to be compulsory for the benefit of the Commission". * July 14, 1967 - The Court denied Nicolas's motion for reconsideration, leading to the present appeal on certiorari. Held: Literal Meaning and Legal Convenience The Supreme Court found that there is nothing in the language of the stipulation on the venue that shows that the intention of the parties was to limit the venue of action to the City of Manila only by interpreting the term "may" as "must" or "shall" to make it mandatory. Moreover, the Court argued the venue in personal actions should be fixed for the convenience of the plaintiff and his witnesses for the interests of justice. In this case, there is no indication that such interests is served by confining the venue of the action to the City of Manila, considering that none of the parties reside in that city. Category:Legal Cases